STX Europe Q4 2009 Results

Tuesday, February 09, 2010

In the fourth quarter 2009 STX Europe reported an EBITDA of NOK -44 million compared with NOK -728 million in the fourth quarter of 2008. The 2009 preliminary EBITDA was NOK 133 million compared with NOK -400 million in 2008. Offshore & Specialized Vessels continue to perform well with an EBITDA result of NOK 250 million in the fourth quarter and a preliminary 2009 EBITDA of NOK 643 million (NOK -29 million in 2008). The Cruise & Ferries business area had fourth quarter EBITDA of NOK -104 million, and a preliminary 2009 EBITDA of NOK -209 million (NOK 103 million in 2008). At the Cruise & Ferries yards, a reduced orderbook combined with low order intake has resulted in restructuring and capacity adjustments.

Satisfactory EBITDA in the Offshore & Specialized Vessels business area continued in the fourth quarter, while the Cruise & Ferries business area is facing challenges with lower capacity utilization and thereby high capacity costs. Furthermore, the fourth quarter result was marked by major restructuring costs and significant loss provisions amounting to NOK -485 million (NOK -530 million for the full year).

STX Europe successfully delivered seven vessels during the fourth quarter and a total of 38 vessels in 2009. This reflects a high activity level and good operational performance, especially within the Offshore & Specialized Vessel business area. The order intake in the fourth quarter was NOK 4 149 million, a significant increase from NOK 400 million in the third quarter 2009. The Offshore & Specialized Vessels business area contributed the majority of the order intake, reflecting good competitiveness within its specialty niches.

The order intake in 2009 totaled NOK 8 922 million down from NOK 10 083 million in 2008. The order backlog at the end of 2009 consisted of 52 vessels, one maintenance contract and two conversion projects for a total amount of NOK 24 677 million.

By securing contracts for 10 new vessels and three smaller projects, the order intake in 2009 has been notable considering the very difficult market situation for all business areas.

In October, the world's largest and most innovative cruise vessel, the "Oasis of the Seas," was delivered to Royal Caribbean International. The delivery marks a giant leap in cruise vessels development and opens new prospects for the global cruise industry.

The Board of Directors is pleased with the Offshore & Specialized Vessels results and considers the outlook to be satisfactory although the need to secure new contracts will become increasingly important in 2010. While the long-term outlook looks increasingly positive, the current excess capacity at the Cruise & Ferries yards creates significant short term challenges. The Board of Directors is committed to continuing the improvement processes, further enhance competitiveness and thereby strengthen the company's position as the world's leading shipyard group within the Cruise & Ferries and Offshore & Specialized vessels business areas.